Accounting Chapter 12 & 13

A(n)____is paid to the employee as a percentage of the employee's sales.

commission

The amount of money actually received by the employee after all deductions are subtracted is called the_____.

net pay

An employee paid 1 1/2 times the regular wage is paid at a(n)_____.

overtime rate

The amount of time for which an employee is paid is called the ____.

pay period

A list of employees in a business and the earnings due to each employee for a specific period of time is a(n)_____.

payroll

The individual who prepares the payroll is called the _____.

payroll clerk

A(n) is a form summarizing information about employees' earnings for each pay period.

payroll register

Taxes paid by the employer to provide funds for workers who are temporarily out of work are ____.

unemployment taxes

The amount of money paid to employees at a specific rate per hour is a(n)_____.

wage

The _____requires larger businesses to deposit income tax payments by electronic funds transfer.

Electronic Federal Tax Payment System

An employer normally pays federal withholding taxes, social security taxes, and medicare taxes once a year.

False

The Cash in Bank account is debited for the amount the employees actually earn in the pay period.

False

The FICA tax has no maximum taxable amount.

False

The amount entered for Payroll Tax Expense is the total gross earnings of the pay period.

False

The entry for Salaries Expense is recorded each pay period, but the entry for Payroll Tax Expense is recorded only at the end of the year.

False

The number of hours worked multiplied by the hourly wage gives the net earnings for the pay period.

False

The only taxes that the employer must pay are unemployment taxes.

False

By January 31, employers must provide each employee with a ____, which summarizes the employee's earnings and taxes withheld.

Form W-2

Each year, an employer must prepare and send to the IRS a(n)____, which summarizes the information contained on the employees' Wage and Tax Statements.

Form W-3

The ____account is used to record the total of the employer's payroll taxes.

Payroll tax Expense

A Form W-4 lists the marital status and number of exemptions claimed by the employee.

True

Amounts deducted from employees' earnings and held for payment by the employer become liabilities to the business.

True

An example of a voluntary deduction is one for a health insurance premium.

True

In a few states, employees are also required to pay unemployment taxes.

True

Overtime is paid to most employees after they work more than 40 hours.

True

The payroll register is the source of information for preparing the journal entry for payroll.

True

The payroll register summarizes information about employees'earnings during a pay period.

True

The social security system was established by the Federal Insurance Contributions Act.

True

The social security tax is paid by both employer and employees.

True

The total FICA tax is divided into two parts: the social security tax and the Medicare tax.

True

When a business transfers money from its regular checking account to the payroll checking account, the check is written for the total net pay amount.

True

____are the year-to-date gross earnings of an employee.

accumulated earnings

A(n)____is an amount subtracted from gross earnings.

deduction

If an employee has_____, the employer placed the employee's net pay into their personal bank account.

direct deposit

A(n) is a device used to scan certain information encoded on a magnetic strip on an employee's time card or identification badge.

electronic badge readers

The____is an individual payroll record kept for each employee.

employees earnings record

The amount deducted from gross earnings for federal income tax each pay period depends on the total earnings, marital status, and the number of _____an employee claims on Form W-4.

exemptions

The form that accompanies an employer's payment of social security, medicare, and employees' federal income taxes is a(n)_____.

federal tax deposit coupon

The_____is the total amount earned by the employee in the pay period.

gross earnings

The expense account used to record employees' earnings is often called_____.

salaries expense

A(n)_____is a fixed amount of money paid to an employee each pay period.

salary

Most companies use a(n)____to keep track of an hourly wage employee's hours

time card